DOMESTIC GAS bills are set to drop by an average €75 a year from next month after Bord Gáis was given the go-ahead to cut prices by 9.8 per cent.
However, domestic electricity prices will remain frozen for a year after the Commission for Energy Regulation (CER) yesterday approved the ESB’s application for a 0.2 per cent cut.
The commission decided against forcing the two utilities to implement bigger price cuts, in spite of the fact that the wholesale price of energy has almost halved since the start of last year.
A spokesman said CER had gone through the figures presented by the ESB and Bord Gáis in detail and decided they were “just about right”. He pointed out that a price cut originally planned for October had been brought forward to May, when gas prices fell 12 per cent and electricity prices were reduced by 10 per cent.
Minister for Energy Eamon Ryan welcomed the reductions in energy prices as vindication of greater competition in the market.
“2009 has been a good year for electricity and gas consumers. They can now reduce their electricity bills by up to 25 per cent and their gas bills by 22 per cent. These are major savings at a time when money is tight for many people. The savings business can expect will protect jobs in this country”.
Bord Gáis said yesterday it remained committed to undercutting the unit price of electricity charged by ESB by 10-14 per cent. Almost 200,000 ESB customers have switched to Bord Gáis in the past year and thousands more have switched to another provider, Airtricity.
Mr Ryan predicted consumers would benefit from further electricity price reductions with the entrance of the two companies into the domestic supply market.
However, he warned that Ireland remained far too dependent on imported fossil fuels. “If we retain this dangerous dependence, we will always be at the mercy of the international market. Our energy security and competitiveness will be best served by the switch to renewable energy.”
Electricity prices for small and medium businesses will fall by 0.4 per cent and 5.5 per cent respectively from October 1st.
Electricity prices went up 17.5 per cent last year, but the ESB has argued that the increase would have been even greater if it had not provided more than €500 million in support to stabilise prices.
ESB workers have not had their pay cut and are not subject to the pension levy.
Fine Gael’s energy spokesman, Simon Coveney, has criticised the ESB’s proposed reductions as “not good enough”.
According to Bord Gáis, the cost of heating an average three-bedroom house has dropped from €916 last October to €813 in May and will fall to €737 next month.